Physician staffing company TeamHealth will acquire IPC Healthcare, an acute hospitalist and post-acute care provider, for $1.6 billion in cash, the companies announced Tuesday.
The companies said the deal will make them better able to improve their post-acute care services and create better value of care for their partner hospitals and clinicians, which in the age of value-based reimbursements will improve bottom lines for all involved.
TeamHealth CEO Mike Snow also said the deal would shore up the company's finances, adding revenue and cash flow that could help fund future acquisitions.
"This transaction ensures that we extend TeamHealth's competitive position, and we are confident that together we will create a more powerful platform from which to deliver significant value creation for our patients, physicians and other stakeholders," he said in a statement.
According to TeamHealth, the deal means the combined company will employ 15,000 healthcare professionals. The deal also brings IPC's 2,000 post-acute facilities under TeamHealth.
TeamHealth said the deal also helps it deliver value, especially in the wake of bundled payment models in which providers essentially split a lump payment that encompasses the entire episode of care from intake to post-acute care. The companies said several of its provider groups have already moved on the stage two of the Bundled Payments for Care Improvement initiative, which bundles acute and post-acute services.
The company also expects to shed $60 million in costs as a result of the companies combining and eliminating duplicate spending.